THE Mersey estuary could be used to generate electricity in what would be the UK's largest wave and tidal power project.

Peel Holdings and the Northwest Regional Development Agency (NWDA) are launching a major investigation today into how to harness power from the river.

They will assess the latest renewable energy technologies in a bid to find one suitable for the estuary, including building an underwater fence, which would stretch across the Mersey and hold tidal turbines in place below water level.

If any of the schemes went ahead it would become one of the biggest engineering projects in the UK, creating thousands of jobs in the region.

The plans will be announced at the Mersey Basin Campaign Annual Conference held at the city's Mariott hotel today and will get under way in spring, with the results due this time next year.

Peter Nears, strategic planning director for Peel Holdings, which owns Mersey Docks and Harbour Company, said: "The North West of England with its extensive and, in places, exposed coastline offers great potential for harnessing the natural power of wave and tide.

"This study will provide vital information on the prospect for marine renewable energy generation on the Mersey and elsewhere in the region.

"The initiative is a natural progression of Peel Group's strong commitment to seeking alternative, beneficial energy sources and we are delighted to join with the Northwest Development Agency who have been instrumental in the establishment of the study."

The Mersey Estuary is regarded as one of the best sites in Europe to generate electricity through wave and tidal power because it has a tidal range of 10m.

But the study will assess how viable such a scheme is. It will have to take into account its significance as a major shipping route as well as its importance as an area of conservation interest.

It is not the first time the possibility of generating power using the river has been considered.

Plans to build a barrage joining Liverpool and Wirral were first mooted in the 1970s.

In 1987 detailed plans were drawn up for a £1bn scheme that would supply three quarters of Liverpool's power needs and create 5,000 jobs.

The plans rumbled on until 1993 but were eventually dropped when the Government failed to come up with the cash needed to fund it.

But technology has moved on considerably since then and the initial survey at least has heavyweight support from the NWDA.

Most important, however, is Peel Holdings' desire to get such a project off the ground.

An offshoot of the Peel Holdings, Peel Environmental, is already involved in renewable energy development and is behind a number of wind farm schemes.

If viable the company would develop the Mersey scheme, enabling it to supply electricity across the region as well as to north Wales.

It would create thousands of jobs across the region, many of which would need the skills of marine industry workers, such as former Cammell Laird employees.

It would also help the city to meet the Government's target of producing 10% of its power through renewable sources by 2010.

The announcement will be made by the Mersey Basin Campaign's chairman, Professor Peter Batey this morning.

He said: "The Mersey Estuary is of international importance for shipping, for industry, for its ecology and for the people who live, work, visit and invest in Merseyside.

"Now it has the potential to contribute to our nation's energy needs. We shall continue to work with our partners to secure a sustainable future for the estuary."